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Pharmaceutical and life sciences firm Jubilant Life Sciences Ltd has received a warning letter (WL) from the US Food and Drug Administration (USFDA) for violating manufacturing practices at one of its units in Washington state, the company informed the stock exchanges on Thursday.

In a statement, Jubilant Life Sciences said, “One of our manufacturing facilities, Jubilant HollisterStier, LLC (JHS) located at Spokane, Washington state, the US, has been issued a WL by USFDA.”

JHS-Spokane, as required by USFDA, will respond to the WL on or before December 12, 2013, it said, adding that the company’s response will identify actions required to address USFDA’s concerns as well as corrective actions to ensure cGMP (current good manufacturing practice) conformity.

“USFDA specified in the WL that until all corrections have been completed, it may withhold approval of new applications or supplements listing JHS-Spokane as the drug product manufacturer,” the statement said.

The company said that it will work closely with the drug regulator to resolve the matter.

It said on-going manufacturing, distribution and sale of products from this unit is unlikely to be affected as the drug regulator’s possible action will affect only new approvals.

According to the statement, the contract manufacturing operations at JHS-Spokane contributed 7% to consolidated sales and 4% to consolidated EBITDA of Jubilant Life Sciences during first half of fiscal 2014.

Shares of Jubilant Life Sciences plunged 10 per cent after the announcement, their steepest one-day fall in nearly six months.

Jubilant Life Sciences manufactures and supplies APIs, generics, specialty pharmaceuticals and life science ingredients, apart from offering services in contract manufacturing and drug discovery and development. The firm is backed by General Atlantic, which is sitting on an unrealised loss of over 50 per cent on its six-year-old investment in the healthcare firm. The PE firm had invested around Rs 240 crore to buy stake in the company in mid-2005. While it exited its investment in Jubilant Industries, which was demerged from Jubilant Life Sciences (Jubilant Organosys at that time), it is holding on to its shares in the healthcare firm.